Federal Reserve's Musalem Raises Alarm on Inflation Risks
Federal Reserve official Musalem has issued a fresh warning on inflation, stating that although price pressures have cooled in recent months, inflation remains stubbornly above the Fed’s 2% target.
According to a report by BlockBeats, Musalem stressed that if inflation expectations begin to drift, the central bank must act decisively to re-anchor confidence in its price stability mandate. “Maintaining stable inflation expectations is critical,” he said, suggesting that policy may need to remain restrictive if inflation proves more persistent than anticipated.
This comes as investors weigh the timing of potential interest rate cuts, with markets hoping for a more dovish stance. Musalem’s comments, however, hint that the Fed may stay cautious, especially if inflation risks resurface.
As economic uncertainty lingers, all eyes will remain on the Fed’s next move—and whether its commitment to price stability will outweigh calls for looser monetary policy.
